Samsung Group boss earned $1 million at flagship in Q4, shows first disclosure

Reuters Staff

3 Min Read

SEOUL (Reuters) - Samsung Electronics Co Ltd said on Friday it paid Vice Chairman Jay Y. Lee, the third-generation leader of Samsung Group, 1.135 billion won ($1.02 million) in the fourth quarter of 2016, disclosing his compensation for the first time.

Samsung Group chief, Jay Y. Lee, arrives at the office of the independent counsel in Seoul, South Korea, February 16, 2017. Koo Yoon-sung/News1 via REUTERS/Files

Lee is currently on trial for bribery, embezzlement and other charges amid a corruption scandal that led to the ouster and arrest of President Park Geun-hye. He became a board member in October as part of a broader initiative to improve corporate governance for the smartphones-to-biopharmaceuticals business empire, and his salary was published alongside other members.

The compensation disclosure, made via a regulatory filing, only applies for payments Lee received following his appointment to the board, and Samsung declined to comment on how much he was paid prior to the appointment - including whether he made more or less in preceding quarters than what was disclosed for the fourth quarter.

The 48-year-old executive’s compensation package includes 476 million won in wages equivalent to three months’ pay from October through December. A Samsung spokeswoman told Reuters that Lee chose not to receive any pay from Samsung Electronics following his Feb. 17 arrest.

South Korean companies are required to disclose compensation for executives who sit on the board and are paid at least 500 million won on an annual basis.

Chief Executive Kwon Oh-hyun was the top earner among the executives who sit on the board with a total compensation of 6.698 billion won. That compared with Apple Inc counterpart Tim Cook’s 2016 compensation of $8.7 million.

The compensation disclosed by Samsung is a very small fraction of Lee’s net worth. According to Forbes, Lee is South Korea’s third-richest person with $6.4 billion in total wealth that is mostly based on his stakes in Samsung affiliates such as Samsung C&T Corp and Samsung Electronics Co Ltd.

Co-Chief Executive Shin Jong-kyun, who overseas the company’s mobile and network businesses, saw his 2016 compensation fall to 3.986 billion won from 4.8 billion won a year earlier. The businesses under his remit oversaw the costly collapse of the fire-prone Galaxy Note 7 smartphones in October.

($1 = 1,117.9600 won)

Reporting by Se Young Lee; Editing by Randy Fabi and Christopher Cushing